The Zip Co Ltd (ASX: ZIP) share price has had an incredible year. It's up 55% in 2025 to date and has soared almost 190% in the last six months, as the chart below shows.
It's true that past performance is not a guarantee of future performance. But, it's also true to say that a high-flying business may not be finished rising yet.
We're going to take a look at what could happen if someone invested $5,000 into the business today at the current Zip share price and what could drive that return.
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Strong momentum for the buy now, pay later company
Broker UBS expects continued strong revenue growth in the US for Zip over the medium term, with data pointing to strength in the first quarter of FY26.
Both July and August 2025 have seen an acceleration in app downloads in the US, with a 21% and 24% increase, respectively.
The August rise was the strongest gain since 2021. UBS also noted that monthly active user growth is strong, with 21% year-over-year growth in August 2025. The trends are positive and point to continued momentum in customer growth in the US.
If customer growth continues with a similar net bad debt level, then this "should be a positive catalyst for the [Zip] share price", according to UBS. The broker is expecting a strong FY26 first-quarter cash operating profit (EBTDA) result.
A forward adjusted cash price-earnings (P/E) ratio of 36x does not seem expensive to UBS because of the growth outlook, despite the rapid rise of the Zip share price.
UBS also said about the prospect for longer-term growth:
Supporting the longer term growth for ZIP, the whole BNPL sector in the US remains early stage with very low penetration of spend and well behind countries like Australia, providing a structural growth trend behind all players currently.
Forecast for $5,000 investment in Zip shares
UBS currently has a price target of $5.25 on the buy now, pay later business. A price target is where analysts believe the share price will be trading in 12 months.
With a $5.25 price target, UBS is suggesting that the Zip share price could rise by 13% at the time of writing, despite the huge rise already.
If a $5,000 investment increased by 13%, it'd deliver an additional $650 thanks to Zip share price gains, ending with the investment becoming worth $5,650.
